EDA - Market Prediction Prediction

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Stock market have always been difficult to predict and even the most brilliant mind of all times had difficulties with the markets

Newton allegedly said that he could “calculate the motions of the heavenly bodies, but not the madness of people.” 1

Stock Market prices are not only defined by companies fundamentals. Human behaviour can alter the true value of a company. The valuation of a company can be understood in two well defined kind of analyses the fundamental and the technical.

For our project we will focus on technical analysis and explore daily data provided by Yahoo about companies and try to predict the Adj Close.

Table of Contents

Data presentation

We will work with daily trading data. We will use Yahoo Finance's data with pandas_datareader.

Yahoo Finance provide OHCL, Volume and the Adj Close.

Data Understanding

Assessing Data

Market Data are not available for all days in a given year

The main reasons are

In general we can assume to have 252 trading day in a year

Correlation

Explore Data

Feature Engineering

We will need some technical indicators to be able to predict the adjusted price.

A well konwn indicator is the Relative Strength Index (RSI).

Volatility